Tour operator MyTravel yesterday showed signs of continuing on the road to recovery after it said bookings had been encouraging for the summer.

The group, which required an £800 million debt overhaul to stay afloat last year, said it had achieved "significant progress" in restoring the business, although it stressed that much remained to be done in the UK.

The company warned high oil prices made its job harder, but said it had purchased fuel at about $60 a barrel of Brent crude, in order to "protect against any extraordinary changes" over the rest of the year. It is also charging a fuel supplement, including £15 for a short-haul flight.

In a trading statement ahead of its annual meeting in London, MyTravel said bookings for the winter period had been in line with expectations and that it had "significantly" fewer holidays left to sell in the UK than last year.

However, its figures will be affected by the Asian tsunami, with refunds and the cost of bringing holidaymakers home affecting results by £12 million.

Much of this - £10 million - related to northern Europe after its Scandinavian division stopped operating to Phuket in January.

Manchester-based MyTravel said it continued to target an operating profit for its three divisions in 2006, as well as an industry standard margin of 3.5 per cent for its UK business in 2007.

As part of the overhaul, MyTravel has reduced capacity for this year and made improvements to its product offering. Cost cuts have also been made.

Chief executive Peter McHugh added: "We will continue to look to be more efficient, but there are no major redundancy programmes planned."

Shortly before its restructuring, the group announced in December annual losses of £190.3 million for the 13 months to October 31.

MyTravel plunged into financial crisis after its operations proved too inflexible to cope with the downturn in the travel market.